On March 19, 2012, Amazon announced an agreement to acquire Kiva Systems, Inc. for approximately $775 million in cash, “as adjusted for the assumption of options and other items.” Kiva, based in North Reading, Massachusetts, made a combined hardware-and-software system that used fleets of autonomous mobile robots to move shelves of goods directly to warehouse workers for picking and packing. Amazon’s announcement said Kiva’s solutions “enable extremely fast cycle times, from receiving to order picking to shipping all in a single solution.”
The acquisition turned a third-party automation supplier into Amazon’s in-house robotics arm. Amazon later renamed the unit Amazon Robotics and stopped selling Kiva systems to other retailers, deploying the robots across its own fulfillment network instead. Over the following decade Amazon became one of the largest operators of mobile robots in the world.
Why business readers should care: the Kiva deal is a clear case of a company buying a capability rather than a product, then pulling it off the open market to keep it as a competitive advantage. It also marks the point where warehouse robotics shifted from a niche vendor business to a core part of how the largest e-commerce operations run.